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Microsoft Corp. may still face a lawsuit after apologizing for the theft of software code used in MSN China’s microblog service, Juku, from rival Plurk, a popular provider from Canada.

“We are definitely looking at all possibilities on how to move forward in response to Microsoft’s recent statement,” Plurk co-founder Alvin Woon said Wednesday. A “lawsuit is definitely one of the many options we have considered and will continue to look closely to,” he added.

Plurk fired off a blog posting early this week alleging as much as 80 per cent of Juku’s code base was stolen from Plurk.

Microsoft apologized Tuesday, saying an outside company hired to develop Juku copied a portion of the code from Plurk. The statement from the world’s largest software vendor is at odds with one from MSN China early this month defending Juku as “a local innovation developed by MSN China … based on Windows Live Messenger networks.” The MSN China statement was a response to Chinese bloggers who early on called Juku a pirated version of Plurk.

The matter puts Microsoft in an unfamiliar position. The company has complained for years about the piracy of its software in China. In spite of its long experience with the issue, the software giant now finds itself apologizing for its failure to adequately safeguard the intellectual property of a rival code developer.

Microsoft could not immediately be reached for comment.

Dave Thompson, a spokesman for Plurk, said the company went ahead with its blog post accusing Microsoft of code theft only after determining willful intent was involved. “The client code and backend code on Plurk is still all proprietary and not easily accessible for anyone to just lift. Speaking technically, what makes our claim a little stronger is that Plurk’s client side code was obfuscated to begin with, so someone went in there and had to spend some real effort to unpack/reengineer the JS code and prettify it on their end,” he said.